40 NEBRASKA CATTLEMAN October 2024 published in July, ground beef accounted for 24 percent of the retail market share, making it the largest of all foodstuffs included in the report. In July, the average price of ground beef was $5.50 per pound, while the willingness-to-pay – an indicator of consumer demand – was $9.11 per pound. Typically formulated as a 5:1 ratio of 90 percent lean beef trimmings (90s) to fatty trimmings (50s), 80/20 ground beef is sourced from the carcasses of both non-fed cattle (cull cows and bulls) and fed cattle (steers and heifers). Heavier steer and heifer carcass weights, combined with a much smaller supply of 90s, have created an imbalance in the ground beef market. As of the first week of July, the wholesale price of fresh 90s was $372.01 per hundredweight, a 45 percent increase from the beginning of the year and a 27 percent increase from the same time last year. Conversely, while the current price of 50s has increased since January, it still reflects a 48 percent decline year over year. In terms of pounds, the supply of 90s is down 16 percent in the first half of the year compared to 2023. Demand for ground beef is the primary driver of domestic imports. To offset the decline in the domestic lean supply, imported beef trimmings are used in combination with 50s to meet ground beef demand. Year-over-year, imported boneless trimmings are up 25 percent, totaling nearly 830,000 tons thus far in 2024. In the month of July, boneless trimmings accounted for 54 percent of all fresh beef imports. The top two importing countries – New Zealand and Australia – supply just over half of all imported trimmings. Beef production in Australia has recently rebounded following a severe drought, providing an ample supply of lean, grass-fed beef for export. Dry conditions have since shifted to New Zealand, resulting in an ample supply of lean trimmings from herd liquidation. Combined, their marketings to the United States have increased by 39 percent from 2023 to 2024 as of the July 1 reporting week. Fueled by a strong U.S. dollar, the price spread between domestic and New Zealand/Australia 90s is historically high – $75.78. Moving ahead in the remainder of 2024, we will continue to keep a close watch for indications of herd expansion. Although cow slaughter has dropped significantly from the first of the year, our current transition into the next phase of the cattle cycle is proving to be more prolonged. It’s unlikely that heavier carcass weights will compensate for the decline in beef production following the onset of heifer retention and expansion. With regard to ground beef, it’s not uncommon for other cuts to be ground with domestic and imported trimmings to meet demand. Considering an increase in retail beef prices among other macroeconomic factors, ground beef will remain a fundamental part of domestic consumption. ~NC~ MARKETS CONTINUED FROM PAGE 38 Choose the fuel your herd needs for: ® WITH PERFORMANCE THAT PAYS ® Fuel Your REPRODUCTIVE success WITH PERFORMANCE THAT PAYS HEAVIER, HEALTHIER, MARKETABLE CALVES FERTILITY ELITE GENETICS HOOF HEALTH COLOSTRUM QUALITY BULL SOUNDNESS & FERTILITY KEVIN GLAUBIUS Nebraska Area Sales Manager kglaubius@biozymeinc.com (816) 344-5762 LEARN MORE AT VITAFERM.COM
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